Attorneys make mistakes.  Sometimes mistakes are fixes, sometimes not.  Rarely do attorneys go to the length of fabricating complaints, making up stories of ongoing litigation and then running away from the disciplinary committee.  We don’t know what defense the attorney might offer, but this tale is both sad and shocking. The attorney in Matter of Gold; Grievance Committee for the Tenth Judicial District ; Motion No: 2011-06543  ;  Slip Opinion No: 2012 NY Slip Op 61346(U)
Decided on January 17, 2012 ; Appellate Division, Second Department, Motion Decision  is now suspended.
 

"We find, prima facie, that the respondent is guilty of professional misconduct immediately threatening the public interest based upon his failure to cooperate with the lawful demands of the Grievance Committee for the Tenth Judicial District (hereinafter the Grievance Committee), with respect to its investigation of one complaint of professional misconduct.

On or about December 6, 2010, the Grievance Committee received a complaint against the respondent submitted by Paul Niehaus, on behalf of his client, David Goldstein. The complaint alleged that the respondent represented Mr. Goldstein in a matter entitled Goldstein v Massachusetts Mutual Insurance Company, commenced in the Supreme Court, New York County, under Index No. 113804/99. Mr. Goldstein, the plaintiff, sought, inter alia, declaratory relief that "the requirement in his disability policy that he be under a doctor’s care and that monthly reports be submitted be deemed waived by defendant." By order dated May 3, 2000, the Supreme Court dismissed the complaint.

On or about February 2, 2005, the respondent commenced another action entitled Goldstein v. Massachusetts Mutual Insurance Company, in the Supreme Court, New York County, under Index No. 2515/05. The verified complaint, dated February 1, 2005, sought a declaratory judgment based, in sum and substance, on the same allegations previously alleged. By order dated August 22, 2005, the court found that the action was barred based on res judicata, as well as the applicable statute of limitations, and the matter was dismissed.

From in or about 2001 through in or about 2006, the respondent allegedly engaged in misleading and deceitful conduct by permitting his client, David Goldstein, to believe that the respondent had commenced a new action on Mr. Goldstein’s behalf in 2001 (hereinafter the purported 2001 action) when, in fact, no new action had been commenced after dismissal of the first action until the commencement of the 2005 action. In response to an inquiry from David Goldstein regarding the purported 2001 action, the respondent, on or about October 29, 2004, forwarded to him copies of a purported amended summons and a purported amended verified complaint, dated November 3, 2003, and on or about January 6, 2006, forwarded to him copies of a purported summons and a purported verified complaint, dated February 12, 2001. None of those pleadings were filed. In response to another inquiry from David Goldstein regarding the purported 2001 action, the respondent, on or about May 3, 2006, forward to him copies of a purported notice of deposition and a purported verified answer, dated April 27, 2001, allegedly submitted by Michael Yoelli, of, Assail & Yoelli, LLP, on behalf of Massachusetts Mutual Insurance Company. Neither the purported notice of deposition, nor the purported verified answer, had been created, prepared or served by Michael Yoelli.

Based on the foregoing, David Goldstein commenced an action against the respondent, on or about December 20, 2006, entitled Goldstein v Gold, in the United States District Court for the Eastern District of New York, under Index No. CV-06-6707, alleging, inter alia, that the respondent had engaged in fraud and legal malpractice. In a Final Judgment by Consent dated November 4, 2010, the respondent consented to the entry of a judgment against him in the amount of $250,000.

By letter dated December 13, 2010, mailed to 5535 42nd Terrace, Vero Beach, Florida 32967 (the business address listed for the respondent with the Office of Court Administration at that time), the Grievance Committee asked the respondent to submit a written answer to the Goldstein complaint. By letter dated December 27, 2010, the respondent submitted an answer and response to a background questionaire. The answer contained another address for the respondent, to wit, P.O. Box 700148, Wabasso, Florida 32970, and the background questionnaire stated that the respondent’s home address was 5535 42nd Terrace, Vero Beach, Florida 32970.

The respondent has neither opposed the Grievance Committee’s motion nor submitted a any response relative thereto."

Based upon the foregoing, the motion is granted, the respondent is immediately suspended from the practice of law, pursuant to 22 NYCRR 691.4(l)(1)(i), pending further order of this Court, the Grievance Committee is authorized to institute and prosecute a disciplinary proceeding against him, and the matter is referred to a Special Referee to hear and report.

Commencement of a new case and the service of process are anachronistic to New York, and provide a wealth of potential problems for the experienced practitioner.  Imagine how confusing it is to the pro-se plaintiff.  In any event, were one to query a group of experienced attorneys, we predict that a shockingly large number would have trouble correctly explaining CPLR 306-b.

So, Henneberry v Borstein ; 2012 NY Slip Op 00235 ; Decided on January 17, 2012 ;Appellate Division, First Department provides a splendid primer in the area.  Plaintiff pro-se started an action, hired a process server, had some problems with service, started a second action, and in the end everything was dismissed.  Here is how the AD settled the issue:
 

"The unintended effect of the disposition of the first two orders appealed from was to deprive plaintiff of an opportunity to pursue her timely filed lawsuit, based entirely upon her failure to effectively complete the ministerial act of properly serving defendants within 120 days of the filing of notice. This was error.

CPLR 306-b provides, as relevant:

"Service of the summons and complaint, summons with notice, . . . shall be made within one hundred twenty days after the filing of the summons and complaint, summons with notice, . . . . If service is not made upon a defendant within the time period provided in this section, the court, upon motion, shall dismiss the action without prejudice as to that defendant, or upon good cause shown or in the interest of justice, extend the time for service."

The statute requires that a defendant challenging service move to dismiss on that ground (Daniels v King Chicken & Stuff, Inc., 35 AD3d 345 [2006]). In deciding such a motion, the express language of CPLR 306-b gives the court two options: dismiss the action without prejudice; or extend the time for service in the existing action. Here, defendants made their motions after the statute of limitations had expired. In these circumstances, the court’s options were limited to [*3]either dismissing the action outright, or extending the time for plaintiff to properly effect service.
The first order appealed from dismissed the action, without prejudice to the filing of a new action, and granted plaintiff’s cross motion for an extension of time to effect service. This directive was internally inconsistent, and it led plaintiff to file the 2010 action, later dismissed as untimely (Matter of Rodamis v Cretan’s Assn Omonoia, 22 AD3d 859, 860 [2005] [court cannot grant CPLR 306-b extension where action has been dismissed and statute of limitations has expired]; see Sottile v Islandia Home for Adults, 278 AD2d 482, 484 [2000]). The court should have limited its ruling in the first order on appeal to granting plaintiff’s cross motion for an extension of time to effect service pursuant to CPLR 306-b (see Lippett v Education Alliance, 14 AD3d 430, 431 [2005]).

CPLR 306-b authorizes an extension of time for service in two discrete situations: "upon good cause shown" or "in the interest of justice" (Leader v Maroney, Ponzini & Spencer, 97 NY2d 95, 104-106 [2001]). The Court of Appeals has confirmed that the "good cause" and "interest of justice" prongs of the section constitute separate grounds for extensions, to be defined by separate criteria (id. at 104). The Court stated,

"Our analysis is buttressed by an examination of the legislative history behind the amendment [to CPLR 306-b]. The New York State Bar Associations Commercial and Federal Litigation Section Committee on Civil Practice Law and Rules characterized the interest of justice standard as more flexible’ than the good cause standard, specifically noting that [s]ince the term "good cause" does not include conduct usually characterized as "law office failure," proposed CPLR 306-b provides for an additional and broader standard, i.e., the "interest of justice," to accommodate late service that might be due to mistake, confusion or oversight, so long as there is no prejudice to the defendant’".

(id. at 104-105 [emphasis added]). A "good cause" extension requires a showing of reasonable diligence in attempting to effect service upon a defendant. At least one Appellate Division decision has suggested that good cause is likely to be found where "the plaintiff’s failure to timely serve process is a result of circumstances beyond [its] control" (Bumpus v New York City Tr. Auth., 66 AD3d 26, 32 [2009] [noting difficulties of service with person in military or difficulties with service abroad through Hague Convention]).
Even if this case does not qualify for an extension under the "good cause" exception (see Mead v Singleman, 24 AD3d 1142, 1144 [2005]), we find that it qualifies under the "interest of justice" category. Under this prong of CPLR 306-b, the Court of Appeals has instructed that a court "may consider [plaintiff’s] diligence, or lack thereof, along with any other relevant factor . . ., including expiration of the Statute of Limitations, the meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiff’s request for the extension of time, and prejudice to defendant" (Leader, 97 NY2d at 105-106).

Here, plaintiff’s attempted March 2008 service, although ultimately deemed defective, was a diligent attempt by a pro se plaintiff to hire a process server to serve defendants at their law firm, within 120 days of the timely filing of a summons with notice. By the time the court ruled on the motions in the 2007 Action, the statute of limitations had expired, precluding the filing of a new action. In addition, defendants were aware of the 2007 Action and appeared to demand a complaint as early as April 2008 – they were not prejudiced by the service errors and were afforded full participation in discovery (see Spath v Zack, 36 AD3d 410, 413 [2007]). Finally, construing the pleading in the light most favorable to plaintiff, as is required on consideration of [*4]a CPLR 3211 motion to dismiss, we find that it asserts actions and omissions by defendants that support viable claims for recovery (see Leder v Spiegel, 31 AD3d 266 [2006], affd 9 NY3d 836 [2007], cert denied 552 US 1257 [2008]).

Khedouri v Equinox (73 AD3d 532 [2010]) and Shelkowitz v Rainess (57 AD3d 337 [2008]), cited by the defense in support of dismissing the action, are both distinguishable on their facts. In Khedouri, the court found that dismissal was warranted because plaintiff made no attempt to serve the defendant, a fitness corporation, within 120 days of filing the summons and complaint. In addition, this Court found no merit to the plaintiff’s underlying claims, given the voluntary assumption of risks inherent in fitness training (73 AD3d at 532-533). Similarly, dismissal was granted in Shelkowitz, a personal injury action involving the accumulation of snow and ice at the defendant’s building, where plaintiff made no attempt to serve the defendant within 120 days of the filing of the action, and the extension request was made 20 months after filing the complaint (57 AD2d at 337). Here, unlike both Khedouri and Shelkowitz, plaintiff attempted service within the 120-day period, defendants were aware of the action soon after the filing of the complaint, and, viewing the amended pleading in the light most favorable to plaintiff, we find it sets forth actionable claims (Spath v Zack, 36 AD3d 410 [2007], supra; Mead v Singleman, 24 AD3d 1142 [2005], supra; Lippett v Education Alliance, 14 AD3d 430 [2005], supra).

Granting plaintiff the opportunity to pursue this action is not only consistent with the "interest of justice" exception set forth in CPLR 306-b, but also with our strong interest in deciding cases on the merits where possible (see e.g. L-3 Communications Corp. v SafeNet, Inc., 45 AD3d 1 [2007]). Accordingly, given our conclusion that the 2007 Action qualified for an extension of time to effect service pursuant to CPLR 306-b, we reverse the third order appealed from and deem the complaint in the 2010 Action to be an amended complaint in the 2007 Action. "

Clients depend on attorneys to advise them on the law. Quick, what do you know about usury? Do you know enough competently to advise a client, or just enough to get yourself into trouble? Here is a legal malpractice story about the later.Theresa Striano Revocable Trust v Blancato 
71 AD3d 1122 ; Appellate Division, Second Department
 

Attorney is retained to perform two mortgage transactions, and notes that the interest rate is 17%. Usury, he wonders? He asks the borrower’s attorney, who tells him not to worry, its a commercial transaction. Naturally, it all falls apart soon enough.

"Before the closing documents were finalized, the defendant Richard T. Blancato, who was the plaintiffs’ attorney, observed that the 17% annual interest rate on the loans might be usurious under General Obligations Law § 5-501 and Banking Law § 14-a, which generally fix the maximum annual interest rate which may be charged for these types of transactions at 16%. He shared his concern with the borrower’s counsel, who assured him that the rate was not usurious because the loans were commercial in nature. Based on this explanation, the defendant was persuaded that no usury issue existed, and never notified Striano about the potential problem.
 

Here, the defendant’s reliance upon the advice of the borrower’s attorney reflects a failure to exercise ordinary reasonable skill (see Shopsin v Siben & Siben, 268 AD2d 578; McCoy v Tepper, 261 AD2d 592, 593; Logalbo v Plishkin, Rubano & Baum, 163 AD2d 511, 514). As the plaintiffs’ current counsel correctly notes, even a cursory review of the relevant statutes would have revealed that the proposed loans did not fall under any usury exceptions. Additionally, the defendant’s efforts to paint his actions in a favorable light are unavailing, as his recent averments directly contradict both his 2008 affirmation and the averments of Thomas Fatato, Striano’s brother, who submitted an affidavit on the defendant’s behalf (see Denicola v Costello, 44 AD3d 990; Telfeyan v City of New York, 40 AD3d 372, 373).

The defendant contends that Fatato ultimately was responsible for the decision to provide the loans despite the potential usury problem. Assuming, however, that Fatato acted as Striano’s agent and was aware of the borrower’s counsel’s advice (such that Fatato’s knowledge can be imputed to Striano), the defendant "may not shift to the client the legal responsibility [he] was specifically hired to undertake because of [his] superior knowledge" (Hart v Carro, Spanbock, Kaster & Cuiffo, 211 AD2d 617, 619).

Accordingly, the plaintiffs established, prima facie, that the defendant acted negligently with respect to the usury issue. Issues of fact exist, however, as to whether Striano was involved in certain decisions regarding the handling of the mortgage foreclosure actions filed against the borrower and, if so, whether those decisions constituted an intervening cause of the plaintiffs’ injuries (see Eisenberger v Septimus, 44 AD3d 994, 995; Brooks v Lewin, 21 AD3d 731, 734; Selletti v Liotti, 22 AD3d 739, 740; Blank v Harry Katz, P.C., 3 AD3d 512, 513). The Supreme Court’s denial of the plaintiffs’ motion was, therefore, proper. "
 

Big law firms take on big cases, and even bigger transactions.  One might read about a $ 50 Million dollar loan concerning a hospital.  One might have seen "Margin Call" and thought about how the sale of those securitized mortgages really takes place, and who checks the paperwork.  In Nomura Asset Capital Corp. v. Cadwalader, Wickersham & Taft, LLP.  we see what happens when things go wrong.

Nomura sued Cadwalader for its failure "to properly advise and represent " NACC and ASC in connection with the securitization of a pool of commercial mortgages and the issuance of a legal opinion stating that the resulting trust would qualify for federal income tax purposes as a real estate mortgage investment conduit (REMIC)"  Now, summary judgment has been denied to Cadwalader.

At issue was a $ 50 million loan made to Doctor’s Hospital of Hyde Park, Chicago.  "When the hospital subsequently went into bankruptcy and Nomura was sued by the trustee to force a repurchase of the loan, Nomura claims it was forced to settle the trustee’s lawsuit for millions of dollars and alleges that it would not have suffered these damages but for Cadwalader’s legal malpractice."

An appraisal of the hospital was performed, but the Cadwalader tax partner did not review the appraisal before signing the opinion letter.  Bankruptcy Court later determined that the hospital was insolvent on the date of the appraisal which valued it at $ 68 million.

Nomura settled cases against itself for $ 68 million and went on to sue Cadwalader.  After this latest round of motion practice, the remaining claims alleged that Cadwalader committed legal malpractice by failing to advise plaintiffs that appraisals of the collateral securing the mortgage loans had to separately value real property, and that there was a failure of due diligence.

Plaintiff’s mother  brought a personal injury case against the City of New York for plaintiff from an injury of December 20, 2002.  She retained defendant attorneys to represent her.  She discharged the attorneys via a "Consent to Change Attorneys" in August , 2006.  She brought the legal malpractice case Fleyshman v Suckle & Schlesinger, PLLC ; 2012 NY Slip Op 00176 ; Decided on January 10, 2012 ; Appellate Division, Second Department.  This case was dismissed on the statute of limitations.

"The Supreme Court erred in denying that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(5) to dismiss the first cause of action, alleging legal malpractice, as time-barred. The defendants sustained their initial burden by demonstrating, prima facie, that the alleged legal malpractice occurred more than three years before this action was commenced in May 2010 (see CPLR 214[6]; Rupolo v Fish, 87 AD3d 684, 685; Krichmar v Scher, 82 AD3d 1164, 1165). In response, the plaintiff failed to raise a question of fact as to whether the statute of limitations was [*2]tolled by the doctrine of continuous representation. All of the documentary evidence demonstrated that the relationship necessary to invoke the continuous representation doctrine terminated in August 2006, and the plaintiff’s submissions did not indicate that her trust and confidence in the defendants continued, or was restored, after that date (see Rupolo v Fish, 87 AD3d 684; Krichmar v Scher, 82 AD3d at 1165; Marro v Handwerker, Marchelos & Gayner, 1 AD3d 488; Piliero v Adler & Stavros, 282 AD2d 511, 512; Aaron v Roemer, Wallens & Mineaux, 272 AD2d 752, 754-755).

Moreover, the Supreme Court should have granted that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(7) to dismiss the second cause of action, which alleged a violation of Judiciary Law § 487. Even as amplified by the plaintiff’s affidavit, and according the plaintiff the benefit of every favorable inference (see Leon v Martinez, 84 NY2d 83), the complaint failed to allege that the defendants acted "with intent to deceive the court or any party" (Judiciary Law § 487[1]; see Jaroslawicz v Cohen, 12 AD3d 160, 160-161). Further, the plaintiff’s allegation that the defendants "willfully delayed [her] recovery with a view to their own ends and benefit" is a bare legal conclusion, "which is not entitled to the presumption of truth normally afforded to the allegations of a complaint" (Rozen v Russ & Russ, P.C., 76 AD3d 965, 969; see Judiciary Law § 487[2]). "

Last August we reported on the legal malpractice case which arose in California and made its way here.  "In this recurring situation, plaintiff has both a California and a NY connection, and hired an attorney to do some work, which eventually goes sour. Frequently a case like this comes up in the entertainment field, with its CA and NY roots. As an example, Basilotta v Warshavsky ; 2011 NY Slip Op 32185(U); August 2, 2011; Sup Ct, NY County; Docket Number: 115525/09; Judge: Paul Wooten shows how the short CA statute of limitations (1 year) undermines the longer NY statute (3 years).

"During the 1980’s plaintiff was a singer known for her popular 1982 song Hey Micky. At all relevant times she has been a California resident. In or about 2003, non party Fallon Inc produced a television commercial for the non-party Subway restaurant franchise that featured Micky without Plaintiff’s knowledge or consent. Subsequent to becoming aware of this commercial, plaintiff retained defendant Oren J. Warshavsky, who at the time worked at defendant law firm Gibbons, Del Deo, Dolan, Griffinger & Vecchione (“Gibbons”).’ Plaintiff alleges that she retained Warshavsky and Gibbons I) to seek compensation for the unauthorized use of Mickey in the commercial, and 2) to clarify her ownership rights to the Mickey master recordings. The retainer agreement between the parties was strictly contingency-fee based, and defines the scope of the retainer as “regarding all causes of action."

The gist of the legal malpractice case is that the attorneys got a settlement offer of $ 35,000 and when plaintiff did not accept, sent a letter to a successor attorney advising him of their position that, among other things, plaintiff had terminated her relationship with Gibbons in December, 2006.

The later legal malpractice case revolved around the ownership and exploitation of the master recordings and whether Gibbons was to blame for legal malpractice. Under CPLR 202, a cause of action accruing in a jurisdiction outside NY must be timely both in NY and in that other jurisdiction
 

Now, the Appellate Division has reversed and dismissed.  "Accepting the allegations in plaintiff’s complaint as true and resolving all inferences in her favor, as we must in considering a motion to dismiss (see Leon v Martinez, 84 NY2d 83, 87 [1994]; Benn v Benn, 82 AD3d 548, 548 [2011]), this legal malpractice action accrued in California at the latest in November 2007, when plaintiff received defendants’ letter unequivocally informing her that they were no longer representing her or prosecuting her underlying actions. Accordingly, under California’s applicable one-year statute of limitations (Cal Code Civ Proc § 340.6[a]), this action, commenced in February 2010, is time-barred.

Contrary to the motion court’s finding, plaintiff’s assertion that it was not until October 2009 that she discovered that Radialchoice, the record company with whom she had held a recording contract, was involuntarily liquidated, did not raise an issue of fact as to whether this action is time-barred. Indeed, plaintiff’s allegation was asserted only in her memorandum of law in opposition to the motion, not in her pleadings or any accompanying affidavit (see Coppola v Applied Elec. Corp., 288 AD2d 41, 42 [2001]). Moreover, plaintiff’s alleged discovery is simply an additional facet of the same nonfeasance of which, according to her complaint, she had been aware since November 2007; thus, it does not constitute a separate wrongful act or omission for statute of limitations purposes (see Peregrine Funding, Inc. v Sheppard Mullin Richter & Hampton LLP, 133 Cal App 4th 658, 685, 35 Cal Rptr 3d 31, 51 [2005]).

Lastly, plaintiff’s allegations support the conclusion that she had inquiry notice of defendants’ alleged nonfeasance more than one year before commencing this action. Indeed, since January 2007, when plaintiff obtained her case files and observed that defendants had performed very little work on her underlying cases, she should have discovered, through the use [*2]of reasonable diligence, the facts supporting liability, including the fact that Radialchoice had been involuntary liquidated (see McGee v Weinberg, 97 Cal App 3d 798, 803, 159 Cal Rptr 86, 89-90 [1979]). "
 

Well, the case is not strictly about Dog, it does derive from litigation surrounding him.  Question:  you have a dispute over a sum of money with "X" and "Y".  You also have a legal malpractice case against your attorney, who worked on the "x" and "Y" case.  If you collect from your attorney in legal malpractice, does that affect your right to the money in dispute with "X" and "Y" ?

In A&E TELEVISION NETWORKS, LLC, , -v.- PIVOT POINT ENTERTAINMENT, LLC,; 10 Civ. 9422 (PGG) (JLC);UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK;2011 U.S. Dist. LEXIS 149740;December 20, 2011 we see:

"Before the Court in this interpleader action are letters from both parties and non-parties in connection with the request of Defendants Duane "Dog" Chapman and Beth Alice Barmore-Smith Chapman (the "Chapmans") seeking to compel Defendant Pivot Point Entertainment, LLC ("Pivot Point") to produce a confidential settlement agreement (the "Agreement"), and all drafts thereof, entered into by the parties in the action Krutonog v. Akin, Gump, Strauss, Hauer & Feld, et al. (the "Krutonog Action") filed in the Superior Court of California for the County of Los Angeles. "

"Here, the Chapmans, who were neither parties to the Krutonog Action nor the Agreement, assert that the unpaid compensation at issue in the Krutonog Action is "in substantial part the same monies that A&E has deposited with the Court in this Interpleader Action" because both actions involve the Co-Executive Producer Agreement. (Joint Letter at 3). As such, the Chapmans argue, any money paid to Krutonog in settlement of his claims mitigates [*5] his and, by extension, Pivot Point’s alleged losses under the Co-Executive Producer Agreement and should offset Pivot Point’s recovery of damages here. (Id.). In addition, the Chapmans contend that the Agreement is relevant because it supports their theory that Krutonog was a de facto talent agent for the Chapmans, which entitles the Chapmans to recover the interpleaded assets deposited by A&E with the Court. (Id.).

While the Chapmans cite to several cases for the proposition that settlement agreements can be discoverable and do not require a heightened showing of relevance in light of Rule 408 of the Federal Rules of Evidence, see, e.g., Small v. Nobel Biocare USA, LLC, No. 06 Civ. 0683 (RJH) (JLC), 2011 U.S. Dist. LEXIS 77838, 2011 WL 3055357, at *1-2 (S.D.N.Y. July 19, 2011); ABF Capital Management v. Askin Capital, Nos. 96 Civ. 2978 (RWS), 95 Civ. 8905 (RWS), 97 Civ. 1856 (RWS), 97 Civ. 4335 (RWS), 98 Civ. 6178 (RWS), 98 Civ. 7494 (TSZ), 2000 U.S. Dist. LEXIS 3633, 2000 WL 191698, at *1 (S.D.N.Y. Feb. 8, 2000), and it is true that Rule 408 applies to admissibility not discoverability of settlement agreements, see, e.g., Conopco, Inc. v. Wein, No. 05 Civ. 9899 (RCC) (THK), 2007 U.S. Dist. LEXIS 27339, 2007 WL 1040676, at *5 (S.D.N.Y. Apr. 4, 2007), they do not cite [*6] to any authority to support the notion that Krutonog’s monetary settlement in a legal malpractice lawsuit should offset his potential recovery in an interpleader action. The Chapmans do not explain why or how money paid to settle the Krutonog Action should serve to offset Pivot Point’s, or enhance the Chapmans’, entitlement to the interpleaded "stake." The mere fact that both lawsuits involve the same agreement—the Co-Executive Producer Agreement, to which the Chapmans are not parties (Joint Letter at 4)—does not, by itself, mean that recovery in one lawsuit should mitigate recovery in another. Recovery in either lawsuit by Krutonog, who is not a party in this action, or Pivot Point, who was not a party in the Krutonog Action, would not violate the rule against "double recovery for the same injury," Shepherd v. Law Offices of Cohen & Slamowitz, LLP, 668 F. Supp. 2d 579, 582 (S.D.N.Y. 2009), as the injuries alleged in both lawsuits—legal malpractice and breach of fiduciary duty on the one hand, and conflicting claims to the interpleaded assets on the other—are entirely different."
 

"As for the Agreement itself, California law permits disclosure only if certain conditions are satisfied, including, for example, if the "agreement provides that it is admissible or subject to disclosure, or words to that effect." See Cal. Evid. Code § 1123(a). Here, however, the Agreement contains a strict confidentiality provision. (Akin Gump Letter at 2). And while an in camera review of the Agreement might determine whether other conditions for disclosure have been met, see, e.g., Cassel v. Superior Court, 51 Cal. 4th 113, 119 Cal. Rptr. 3d 437, 244 P.3d 1080, 1089 (Cal. 2011) (quoting Cal. Evid. Code § 1123(b) (disclosure of written settlement agreement permitted if "’agreement provides that it is enforceable or binding or words to that effect’"), such a review is unnecessary at this time. The California Superior Court in the Krutonog Action entered a sealing order to protect the confidentiality of the Agreement. (Joint Letter at 6; Akin Gump Letter at 2). Pursuant to Rule 2.551(h)(1) of the California Rules of Court, "[a] sealed record must not be unsealed except on order of [*10] the court." The record before the Court does not indicate that the Chapmans have obtained any such order. Accordingly, the Chapmans have not established that the Agreement is discoverable."

"In sum, the Chapmans’ request is denied. Any application to unseal the Agreement, and subsequently to compel its disclosure upon a showing of relevance under the applicable law, is appropriately made by the Chapmans in Superior Court in California."

Sometimes the attorney representing a client is actually retained by the client, and sometimes the attorney is provided to the client.  In one recurring situation, union members are provided with legal representation.  The member (plaintiff) does not have an attorney-client relationship with the attorney.  That relationship and the privity that is created is between the union and the attorney, and the member may not sue the attorney for legal malpractice.

in Cruz v United Fedn. of Teachers  ;2011 NY Slip Op 33499(U); December 23, 2011
Supreme Court, New York County; Docket Number: 103386/11; Judge: Eileen A. Rakower the client-member was a teacher who was charged with "unsatisfactory performance, misconduct or other disciplinary charges"  From there it was on to a "rubber room."  From the decision:

"Based upon the charges against her, Plaintiff was placed on an Ineligible Inquiry List, was removed from her teaching responsibilities, and was placed in a Temporary Reassignment Center – otherwise known as a “rubber room.” Plaintiff states that she provided UFT with timely notice
of the charges and her reassignment. UFT then called upon defendant New York State Unified Teachers (“NYSUT”) to represent Plaintiff in her Education Law $3020-a hearing. Defendants Sandner and Rubinstein were assigned to be Plaintiffs attorneys concerning her disciplinary charges.

Plaintiff claims that Sandner and Rubinstein failed to adequately represent Plaintiff during the course of her disciplinary proceeding. Specifically she states that during the two year pendency of her disciplinary charges, they never moved to have the charges dismissed or dropped; and that during the proceedings, they failed to “raise jurisdictional or other objections to the disciplinary hearing process.”

In 2008, during her- disciplinary proceeding, Plaintiff, along with other teachers, filed a lawsuit against UFT alleging, inter alia, that UFT (1) failed to honor its obligations to Plaintiff and to other teachers who were reassigned to the “rubber room” and facing disciplinary charges; (2) was discriminating against Plaintiff and (3) that UFT was failing to fairly represent her. Plaintiff alleges that, in response to, and in retaliation for commencing the lawsuit against UFT, defendant Moerdler, a UFT attorney, advised NYSUT, Sandner and Rubinstein that they should end their representation of Plaintiff. Sandner and Rubinstein complied and moved to withdraw as Plaintiffs attorneys, citing a conflict of interest. After the arbitrator granted Sandner and Rubinstein’s motion to withdraw, Plaintiff proceeded pro se. After the hearing, the Arbitrator issued a decision dated
December 1,2008 finding Plaintiff guilty of ten out of the 14 specifications brought against her (see Cruz v. New York City Dept. of Educ., 20 10 NY Slip Op 5001 6U [Sup. Ct., N.Y. Co. 20101) (denying Plaintiffs Article 75 petition challenging the termination). Plaintiff claims that her termination was the result of her pro se status and her inability to adequately defend herself.

Here, the court finds that Plaintiffs complaint must be dismissed. Petitioner’s DFR claim is clearly barred by the four-month statute of limitations set forth in CPLR 52 17(2)(a), which provides:
Any action or proceeding against an employee organization subject to article fourteen of the civil service law or article twenty of the labor law which complains that such employee organization has breached its duty of fair representation regarding someone to whom such employee organization has a duty shall be commenced within four months of the  date the employee or former employee knew or should have known that the breach has occurred, or within four months of the date the employee or former employee suffers actual harm, whichever is later. Further, the court notes that, even if timely, Plaintiff fails to state a DFR cause of action.

Plaintiff‘s additional claims are preempted by her DFR claim, and may not be asserted in order to circumvent the applicable four-month statute of limitations (see Roman v. Ciq Emples. Union Local 237, 300 A.D.2d 142 [lst Dept. 20021 (“The expedient of characterizing a claim for breach of the duty of fair representation as one  for breach of contract is unavailing to avoid the four-month limitations period prescribed in CPLR 2 17(2)(a)”); Mamorella v. Derkasch, 276 A.D.2d 152, 155 [4th Dept. 20003 (“attorneys who perform services for and on behalf of a union may not
be held liable in malpractice to individual grievants where the services performed constitute part of the collective bargaining process.. .. Plaintiff is limited to bringing an action against the union for breach of the duty of fair representation.”).